Japanese VLCC contract win highlights India’s weak tanker fleet

Japanese VLCC contract win highlights India’s weak tanker fleet

India’s limited VLCC fleet has been exposed with the latest chartering news from Indian Oil Corporation (IOC).

IOC selected Japan’s Nissen Kaiun for a lucrative seven-year VLCC charter, after Indian owners were given first right of refusal to match the rate but failed to do so.

IOC will pay Nissen Kaiun $31,950 per day for the use of the scrubber-fitted Bright Pioneer having issued a tender earlier this year for the hire of a 10-year-old or younger scrubber-fitted VLCC for a firm five years with options to extend by a further two years.

Indian owners have been lobbying for more long-term contracts from local state-run firms, but the limitations of the local merchant fleet have hindered this process.

Of the seven VLCCs run by Indian shipowners, only one – Desh Vibhor – run by Shipping Corporation of India is less than 10 years old but is deployed on another contract.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

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1 Comment

  1. Avatar
    Kapil Kekre
    July 15, 2019 at 6:38 pm

    Sam, disappointed to read your conclusion.

    One needs no explanation why Indian companies didn’t opt for ROFR $31950. It can’t be a judgement on Indian company’s business processes.

    But why Indian Government with reliance on 80% imports and growing demand of Crude Oil is not able to use the strategic position and favourable market situation to push condition of change of flag and increase it’s tonnage is a question that definitely needs explanation for it’s people.